Nigeria's Securities and Exchange Commission has banned the marketing, promotion, and solicitation of the initial public offering by Dangote Petroleum Refinery and Petrochemicals FZE, warning that no application for such an offering has been filed with or approved by the regulator.
In a public notice issued on Tuesday, June 23, the SEC expressed concern over the involvement of some registered Capital Market Operators in what it described as an unwholesome and manipulative exercise. The regulator noted the circulation of advertisements, flyers, digital banners, and targeted electronic messages on social media platforms and investment channels soliciting subscriptions for the anticipated public offer.
The Commission stated that the ongoing pre-marketing activities risk misleading investors, creating false market expectations, distorting price discovery, undermining market integrity, and eroding investor confidence in Nigeria's capital market.
All registered CMOs have been directed to immediately cease publishing, reposting, distributing, or promoting any material relating to the purported acquisition or allocation of shares in the refinery. They must remove all unauthorised promotional materials from websites, social media platforms, and messaging groups within 24 hours of the notice.
Operators have also been instructed to stop accepting deposits, commitments, account openings, or expressions of interest relating to the purported offering. Any monies already collected from investors must be reversed and refunded within the same 24-hour window.
The SEC warned that invitations urging investors to create accounts, pre-fund, or secure guaranteed allocations for the proposed offering amount to market manipulation and constitute serious violations of the Investments and Securities Act, 2025.
Failure to comply with the directive will attract regulatory sanctions under the ISA 2025 and the Commission's rules and regulations.
The regulator emphasised that public offers of securities can only commence after the SEC has reviewed and approved all relevant documentation, including the prospectus. It assured investors that should it eventually receive and approve any application relating to a public offering by the refinery, such approval would be formally communicated through official regulatory channels.
Market analysts note that the unauthorised pre-marketing of public offerings can create speculative demand, inflate investor expectations, and expose unsuspecting investors to significant financial risks. The SEC's intervention underscores growing regulatory concern over unauthorised capital raising activities and the increasing use of digital platforms to solicit investments before obtaining regulatory clearance.
